04-02-16

EU Commission's economic outlook remains roughly unchanged

The risk that growth could turn out worse than forecast has risen, though, mainly as a result of external factors, the Commission says

Moscovici presents Commission's new growth forecasts

The EU Commission said in its winter forecasts released on Thursday that the overall growth outlook has changed little since the autumn but that the risk that growth could turn out worse than forecast has risen, mainly as a result of external factors. In the Eurozone, growth is now projected to increase to 1.7 percent this year from 1.6 percent last year, and to climb to 1.9 percent in 2017. EU economic growth is forecast to remain stable at 1.9 percent this year and rise to 2.0 percent next year.

Certain factors supporting growth are now expected to be stronger and last longer than previously assumed, the Commission said. They include low oil prices, favourable financing conditions and the euro's low exchange rate. At the same time, risks to the economy are becoming more pronounced and new challenges are surfacing, namely slower growth in China and other emerging market economies, weak global trade as well as geopolitical and policy-related uncertainty, it said.

EU Economics Commissioner Pierre Moscovici said the European economy was successfully weathering new challenges this winter, supported by cheap oil, the euro rate and low interest rates. “Nonetheless, the weaker global environment poses a risk and means we must be doubly vigilant. There is more work to do to strengthen investment, enhance our competitiveness in a smart way and complete the job of fixing our public finances,” he remarked.